Use the Following to Answer Questions

question 6

Multiple Choice

Use the following to answer questions :
Exhibit: Saving and Investment in a Small Open Economy
-(Exhibit: Saving and Investment in a Small Open Economy) In a small open economy, if the world interest rate is r₁, then the economy has:

• A) a trade surplus.
• B) balanced trade.
• C) a trade deficit.
• D) negative capital outflows.

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Definitions:

Machine Metaphor

A comparison or conceptual model that likens complex systems or organisms to machines, emphasizing efficiency, input-output processes, and functional parts.

Drive Metaphor

A psychological concept suggesting that motivation stems from the desire to fulfill basic biological needs, similar to how a car is driven by the need for fuel.

Cognitive Metaphor

A linguistic expression that allows for comprehension and experience about one idea, or conceptual domain, in terms of another.

Neural Impulse

The electrical signal transmitted along a neuron, facilitating the communication between the brain and different parts of the body.